CALIFORNIA FOCUS
FOR RELEASE: TUESDAY, NOVEMBER 12, 2013, OR THEREAFTER
FOR RELEASE: TUESDAY, NOVEMBER 12, 2013, OR THEREAFTER
BY THOMAS D. ELIAS
“REVELATIONS SHOW WHY MORE CAMPAIGN DISCLOSURE IS A MUST”
Just in case anyone doubts the need
for a lot more transparency in political fund-raising, a remarkable settlement
just obtained by California’s campaign finance watchdog and accompanying
demands for disgorgement of previously undisclosed donations should erase all
doubt.
The extraordinary thing about the
settlement and the commission orders wasn’t the $1 million in fines assessed on
two political committees, even though that’s an all-time record. Eclipsing the
big fines were the volume of donor cash and the sheer hypocrisy revealed when
one political committee inadvertently revealed its major contributors.
This case was all about two 2012
ballot propositions and the money spent for and against them by two Arizona
political nonprofits tightly linked to the Kansas-based billionaire
industrialist brothers David and Charles Koch, well known for funding
ultra-conservative causes and the Tea Party.
There was no hypocrisy when their
committees, the innocuously-named Center to Protect Patient Rights and Americans
for Responsible Leadership, funneled more than $28 million of other
people’s cash into campaigns. The cash was used against Proposition 30,
Gov. Jerry Brown’s initiative temporarily raising some state taxes, and for
Proposition 32, a failed attempt to limit unions’ political power. Still, the
two committees now must pay a combined $1 million for not disclosing donors
before last year’s votes.
Then there’s Los Angeles developer and
philanthropist Eli Broad, the B in the giant development firm KB Homes.
Broad during the campaign publicly
supported Brown’s tax increases. “Those of us that are wealthy like myself
should pay more,” he said.
But he apparently contributed $500,000
to the campaign against the proposition. Oh, this hasn’t been formally
disclosed or acknowledged. But redacted records obtained and then released by
the state Fair Political Practices Commission show someone with the first name
Eli, last name blacked out, with a 12th floor office in a Wilshire
Boulevard building at a five-digit address in Los Angeles, made the
contribution. Broad’s foundation has an office on the 12th floor at
10090 Wilshire.
There was also Charles Schwab,
principal of the eponymous San Francisco-based investment and brokerage firm,
identified in a similar way. Nominally apolitical, Schwab apparently kicked
$6.4 million into the two campaigns.
It’s not exactly a fine, but the FPPC
is also demanding that a California group called the Small Business Action
Committee, which used $11 million from those secret donations and others on the
campaigns, hand that amount over to the state by Nov. 30.
“The money is all gone, all spent on
the campaign. We don’t have that amount and it’s unlikely we could get it by
the deadline,” says Joel Fox, head of the small business group and founder of
the Fox & Hounds daily political blog, also nominally non-partisan. Because
this case is unprecedented, it’s unclear what might befall Fox, a former head
of the Howard Jarvis Taxpayers Assn., and his enterprises if he doesn’t pay.
“We did report everything we knew
(about donors) at the time,” he wrote in an email. “We think this is a
misapplication of the disgorgement law and are going to fight it.”
In all, 132 wealthy donors kicked
significant cash into these two campaigns. Brown turned their
secretiveness against them, making convenient bogeymen of the Kochs and others
presumed at the time to be hidden donors (no one guessed Broad or Schwab were
among them).
But Brown, the ultimate savvy
political veteran, was uniquely equipped to turn big donations against the
causes of those donors. Not many future initiative backers and opponents will
be so skilled. So full disclosure is a must for the public to know who’s behind
what.
Had voters passed a 1990s-era
initiative demanding that all TV commercials and newspaper ads for or against
ballot propositions identify their leading donors in type matching the largest
anywhere else in the ads, there would have been no secret about all this. It
would have been clear that billionaires were spending tens of millions to
protect their interests, regardless of what they might have said at the same
time.
That is the kind of information
California voters need, and it’s up to the Legislature to demand it, even if
that requires lawmakers to offend some of their own donors.
-30-
Elias is author of the current book “The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government's Campaign to Squelch It,” now available in an updated third edition. His email address is tdelias@aol.com
Elias is author of the current book “The Burzynski Breakthrough: The Most Promising Cancer Treatment and the Government's Campaign to Squelch It,” now available in an updated third edition. His email address is tdelias@aol.com
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